As the Senate nears a deadline to determine how to work within the parameters of the national statutory borrowing limit, raising the national debt ceiling may not be all that unconstitutional, a CNN Money story says.
In the June 30 article, scholar Garrett Epps and fiscal expert Bruce Bartlett were quoted as saying that President Barack Obama may be permitted to do just that by invoking the 14th Amendment, which states that "the validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned."
The pending debt ceiling vote would have to raise the current borrowing limit of $14.3 trillion by about $2.4 trillion to last until the end of 2012, according to a story from MarketWatch concerning the House of Representatives' unwillingness to pass a bill that would allow the government to borrow any more money without caveats.
In the CNN Money discussion, Bartlett argued invoking the 14th Amendment to prevent default is "no less justified than using American military power to protect against an armed invasion without a congressional declaration of war."
Treasury Secretary Tim Geithner referred to the 14th Amendment at a Politico breakfast last month when speaking of a potential rise to the debt ceiling, emphasizing the point in the article that such a raise "shall not be questioned," he told CNN Money.
Yet despite Geithner's accuracy in referring to the constitutional allowance the amendment provides Obama in raising the debt ceiling, thus buying those on Capitol Hill more time, Mark Landler of the New York Times reported Thursday that two officials close to Geithner said that he is considering leaving the Obama administration after a deal is reached.
If Geithner does leave, he would be the last member of Obama's brain trust to leave the administration, Landler said.
Jeanne Sahadi of CNN Money wrote that Capitol Hill brass ought to raise the debt ceiling by Aug. 2 because that's the day when the U.S. Treasury Department estimates it will no longer be able to pay all the country's bills, resulting in some uncomfortable scenarios.
"Even if they can't come up with a deal by Aug. 2, lawmakers should raise the debt ceiling anyway," she wrote. "Then they should make a pot of coffee and go back to hammering out a debt-reduction plan. Fiscal responsibility isn't a one-off proposition; it's an ongoing process."
Among such consequences would be the embarrassment of signaling to other countries that Americans are "willfully choosing not to pay their bills."
The United States may also use bond purchases in an effort to escape from risk-based purchases.
Thursday afternoon, Jim Kuhnhenn of the Associated Press reported that Senate Majority Leader Harry Reid said the U.S. Senate will even bypass its typical Fourth of July break in an effort to come to an agreement before the deadline and avoid the default, which the Obama administration is warning would throw the world financial markets into turmoil.
Many congressional Republicans aren't convinced, and some administration officials worry that it could take a financial plunge before Congress acts.
Kuhnhenn also wrote that House Speaker John Boehner, R-Ohio, replied that an increase in the debt ceiling will pass only if the White House agrees to spending cuts in excess of the debt limit increase, holds down future spending and raises no taxes.
"The longer the president denies these realities," Boehner said, "the more difficult he makes this process."
CNN Politics also reported that at his news conference, Obama took issue with criticism that he has not pushed for an agreement. He argued that he has spent an hour to an hour and a half each with Republican senators, Democratic senators and House members from both parties.
"I've met with the leaders multiple times," he continued. "At a certain point, they need to do their job."
USA Today reported Thursday that Obama's tough talk about Congress' work ethic came as a surprise during his press conference. "But the president had a lot to say," says Today's David Jackson: "There's no point in procrastinating," Obama said. "There's no point in putting it off. We've got to get this done. And if by the end of this week we have not seen substantial progress, then I think members of Congress need to understand we are going to start having to cancel things and stay here until we get it done.
"They're in one week, they're out one week. And then they're saying, 'Obama has got to step in.' You need to be here! I've been here. I've been doing Afghanistan and bin Laden and the Greek crisis. You stay here! Let's get it done. All right. I think you know my feelings about that."
The story further explains how Senate Minority Leader Mitch McConnell, R-Ky., invited Obama to lunch with Senate Republicans to discuss his plans for increased government revenues, which Republicans interpret as tax hikes.
At lunch, Obama "can hear directly from Republicans why what he's proposing won't pass," McConnell said. "And we can start talking about what's actually possible."
"It doesn't sound like that lunch will happen," Jackson said.
White House spokesman Jay Carney said Republicans are well aware of the president's position, which includes eliminating subsidies and tax breaks for wealthy Americans, such as oil company and private airplane owners.
CNN also reported that Obama said Congress should cancel upcoming summer vacations if a deal isn't struck by the end of the week.2 comments on this story
"I want everybody to understand that this is a jobs issue. This is not an abstraction," he said. "If the United States government, for the first time, cannot pay its bills — if it defaults — then the consequences for the U.S. economy will be significant and unpredictable. And that is not a good thing."
CNN senior political analyst David Gergen wrote that Obama's speech "will prompt hard feelings among conservative leaders and won't really please liberals who worry that he isn't doing enough to goose up the economy and may give away the store on deficit reductions.
"Neither side really wants to let the government go into default," he continued, echoing Sahadi's sentiments. "So, the prospect of a short-term fix grows, and this is something that won't please anybody, will rattle the financial markets and will once again send a message that the circus goes on."